Stock Market

LIC profits soar to Rs 16,000 cr in first 9 months of FY17

M Saraswathy
Chillicious News

Life Insurance Corporation of India (LIC)’s equity investments this financial year have been subdued. The insurer invested Rs 39705 crore in the nine months ended December of this financial year compared to Rs 64,000 crore invested in same period last year.

VK Sharma, Chairman, LIC said that they are a contrarian player in the markets. He added that equity usually forms 12 percent of their total investible assets.

“We have deliberately taken this decision because of the way the markets are moving,” he said. LIC booked profits of Rs 16,000 crore in the nine month period of FY17 compared to Rs 9500 crore in FY16.

In terms of debt investments, in the nine months ended December 2016, LIC has invested Rs 1.98 lakh crore in debt, of which Rs 1.83 lakh crore went into government securities and state development loans.

With respect of new business premiums, LIC saw 40.1 percent growth for nine months ended December over same period last fiscal. Sharma said that they hope to touch Rs 35,000 crore of new premiums by the end of March 2017.

The country’s largest insurer saw the total assets rise to Rs 24.42 lakh crore for nine months ended December 2016, showing a 12.8 percent growth over same period of FY16.

During the demonetisation period, while in the initial 15 days LIC saw a 25 percent drop in overall premium collections, the situation improved 40 days post November 8, when the note ban was announced.

From the next financial year when Goods and Services tax (GST) will be applicable, it is anticipated that insurers will also be required to pay a higher tax. Sharma, however, said that they will not increase premiums for policyholders.